Here I go to yet another IT conference to talk convergence and platform. Salesforce invited me to its summer marketing conference in June and promised an interview with a Vice President. I could take my wife out to a good anniversary dinner, visit family, and go to a tech conference with a good interview all on one trip. Too good to pass up.
This was the Salesforce Connections conference. Not as big as Dreamforce in San Francisco, but still quite large by our standards in manufacturing.
Salesforce is more than the CRM company it was. Many acquisitions later, it has assembled an array of technology. Like all tech companies, it has a platform. In fact due to its open APIs, you could use it, too. Some time ago, I interviewed the CEO of a manufacturing ERP company called Kenandy that was build upon the Salesforce platform. Rootstriker, another ERP company build on the Salesforce platform, recently acquired Kenandy.
Featured in one keynote was an application by MTD, a manufacturer of lawn tractors (Cub Cadet, etc.). No, Salesforce doesn’t run machines. It does help connect the manufacturer with its end customers and then with its dealers with feedback to the manufacturer.
The idea is that customers do online research and so need to be reached in many ways (thus Salesforce marketing). MTD erected an online store on the Salesforce platform (in simplified terms) for direct to the consumer interaction. An order is fulfilled by the local dealer. The dealer still gets margin and relationship and as an extra added bonus, the opportunity for service business. Linking all back to MTD, it gets to know the customer, satisfies the dealer, plus receiving data from the service business feeds back into product development.
Achyut Jajoo, Salesforce VP automotive/manufacturing, told me industry is moving from product centric to system, e.g., autonomous vehicles, mobility services, digital signals; factory automation, geographic expansion, intelligence, vehicle sales. Mobility services lead to transaction service—over air updates, location based services.
He noted that people start online and mostly know what they want before visiting a dealer. Other manufacturing customers tying their whole sales systems back to manufacturing include John Deere and Ecolab.
“State of the Connected Customer” report
Before I went to the conference, Saleforce sent me this interesting report—a survey of over 6,700 consumers and business buyers worldwide that looks at the ever changing landscape of customers’ expectations, the emerging technologies influencing these expectations and the role trust plays in the customer experience.
Customers today are energized by tech innovations — but also plagued by deepening distrust of the companies that provide them. They have high expectations about what makes a great customer experience, and not a lot of patience for companies that fail to deliver.
These trends impact every company, regardless of whether they sell to consumers or business buyers purchasing on behalf of their companies. In this research, “customers” is an aggregate of both consumer and business buyer responses.
The report dives into the nuances of this tricky customer landscape. Here are five of the high-level findings our research brought to light:
1. Customer experience matters even more than you think
Eighty percent of customers say that the experience a company provides is as important as its products or services. A majority take this sentiment a step further by voting with their wallets; 57% have stopped buying from a company because a competitor provided a better experience.
2. B2B expectations mirror B2C standards
The concept of “B2Me” isn’t new, but it’s gathering steam. Eighty-two percent of business buyers want the same experience as when they’re buying for themselves. But only 27% say companies generally excel at meeting their standards for an overall B2B experience, signaling ample room to improve.
3. Companies face new connected mandates
For 84% of customers, being treated like a person — and not a number — is very important to win their business. Another 70% say connected processes are very important to win their business (such as seamless handoffs between departments and channels, or contextualized engagement based on earlier interactions).
Even before a purchase, personalization is hugely important; 59% of customers say tailored engagement based on past interactions is very important to win their business.
While they buy, 78% of business buyers seek salespeople that act as trusted advisors with knowledge of their needs and industry.
4. Technology sets new benchmarks for innovation
Real innovation, not lip service, is a deciding factor for most customers. 56% of customers (including 66% of business buyers) actively seek to buy from the most innovative companies.
While some emerging technologies are only starting to take root, a majority of customers say these technologies have transformed (or are actively transforming) their expectations: the Internet of Things (60%), voice-activated personal assistants (59%), and AI (51%).
5. Facing a crisis of trust: finding the balance between personalization and privacy
Sixty-two percent of customers say they’re more afraid of their data being compromised now than they were two years ago — and nearly half of customers (45%) feel confused about how companies use their data.
82% of customers will share relevant information about themselves in exchange for connections between their digital and in-person experiences.
81% of customers will share relevant information about themselves in exchange for more consultative help from salespeople.
85% of customers will share relevant information about themselves in exchange for proactive customer service.
For 92% of customers, the ability to control what personal information is collected makes them more likely to trust a company with that information.
There are electric motors and then there are electric motors. On my recent trip about an hour south to the Siemens electric motor manufacturing plant in Norwood, OH (a suburb of Cincinnati) I was often thinking about the line from Crocodile Dundee when the main character pulled out that child of a sword and Bowie knife and said, “Knife? That ain’t no knife. This is a knife.” When we start talking Medium Voltage motors at greater than 10,000 HP, that’s a motor.
Note: the one in red is a motor under test. Note the size versus the size of the person.
I’ve visited the plant a time or two before but wrote the news for magazines. Only a mention on my blog. When I was there in 2012, they talked about the transformation of the plant from a traditional old-school heavy manufacturing plant to a modern, lean, clean place to work putting out quality products.
The occasion for this visit was to view results of some significant investments by Siemens in maintaining Norwood as a state-of-the-art motor manufacturing plant. There are several new machines for precision machining of large parts. The pièce de résistance however was a new test bed and “Test Center Observatory” where customers can witness the testing of their motors in comfort with a dedicated Ethernet connection so that they can continue working during downtimes in the test process. A complete test regimen can last for several hours or even longer. Some customers come from other countries. Speaking as someone with experience traveling to witness tests on my products for certification, I’d have really appreciated this facility back in the day.
Before I get to the test bed, a brief discussion of digitalization and vibration.
Siemens has developed a digitalization methodology for motors called Drive Train Analytics. They are sensoring more and more in order to monitor and analyze a more complete virtual picture of the motor. Not surprisingly, they use Siemens Mindsphere sending data to the cloud using a variety of analysis tools. Customers have access to these tools in the observatory. Actually, customers could receive a complete virtual runoff of their motor back home. But engineers being engineers, they love to see the hardware in person. So they get both.
Aside from heat, the main killer of motors is vibration. Siemens has taken steps both to reduce vibration in the motor and to reduce ambient vibrations in the test process so that more accurate readings of the motor itself.
Working with customers who provide feedback from their use cases, Siemens developed a new shaft requiring new machining techniques. Some of the advantages of the new shaft include:
- Eliminates variation due to fabrication and spider bar tolerances
- Reduces required balance weight applied during rotor balance
- Removes heat-treatment process
- Improves rotor thermal stability
- More predictable rotor lateral stiffness
- Reduces stress concentration of weldment
The News-Test Observatory
With its celebration of more than 120 years of innovation, market and product leadership, technology and quality, Siemens’ Norwood Motor Manufacturing plant recently opened a new Test Observatory.
Opened in 1898, the Norwood facility has undergone a century of change, as the process to manufacture motors and the technology behind them has improved. Norwood has stood the test of time through three industrial revolutions and is one of the longest continuously operating Siemens’ plants globally. With Industry 4.0 upon us, the mechanical motor of old is now a connected device, a valuable plant floor asset capable of providing vast amounts of data with preventative and predictive analytics to ensure more productivity, efficiency and uptime.
With the largest motor test base in North America, Siemens can combine its century of industry leadership in motor manufacturing with an enhanced customer experience. The new equipment extends Norwood’s testing range from 10,000 horsepower (HP) to 20,000 HP at frequencies from 10 Hz to 300 Hz, thus addressing the market’s increased use of variable frequency drives. The new test observatory, akin to an executive suite, allows customers to participate by observing testing through bay windows, direct cameras and mirroring computers, which display real time critical data being gathered by sensors attached to their motor.
The project, which began in 2016, required the removal of 550 tons of soil and concrete from the site, excavating a 13-foot deep hole, driving 114 pilings for stability and building a huge concrete vault to securely support a fully loaded test stand. The test stand weighs 360 tons and rests on a self-leveling air spring system designed to support 500 tons when loaded with motors and drives.
The testing equipment includes two Sinamics Perfect Harmony GH180 drives and two dynamometers. Generating power to test a 20,000 HP motor requires significant amounts of electricity, and by recycling power to the grid, the new equipment reduces power loss by 90 percent.
“At Norwood, we test every motor that we produce or repair – some 30 to 50 tests per week – and these new facilities give us the ability to conduct as many as five motor tests at a time.” said Tim Bleidorn, Manager, Manufacturing Excellence. “We expect the customer witness tests to average two to three per week and as many as 120 per year.”
In addition to the new test base and observatory, the multi-million dollar investment in Norwood also includes WFL high-precision shaft making equipment and a high-speed balancer, key for two-pole applications at higher speeds and the ability to balance a rotor at up to 12,000 rpm.
“It’s exciting and I’m proud that Siemens is investing in the North American market. We have the No. 1 market share in AboveNEMA motors right now and these new capabilities send a strong signal to our customers and competitors that we intend to maintain that position,” says Ryan Maynus, AboveNEMA Product Manager.
With more than 100 patents, the 350,000 square-foot facility is a cornerstone to Siemens AboveNEMA motors. The ISO-9001 certified plant has produced more than 150,000 high voltage motors since 1898. The Norwood plant produces horizontal AC induction motors up to 20,000 horsepower and voltage ranges from 460 to 13,200 volts. The plant also manufactures a complete line of large AC vertical motors up to 8,000 horsepower.
Rockwell Automation’s recent huge investment in PTC for only 8% of the company has sparked a number of thoughts on strategies not only of Rockwell Automation, but also other companies in the market. We’re looking not only at Rockwell Automation in this brief analysis, but also Siemens, Schneider Electric, and ABB.
I’ve left out Emerson, Honeywell, and Yokogawa. The only interesting thing in that part of the market is Emerson’s abortive run at acquiring Rockwell. That was strange. I don’t think that Emerson could have digested such a meal.
The analysis is not to knock anyone but to look for trends and strategies of some of our major suppliers.
I think it begins with Siemens. An executive explained the company’s digital factory strategy and vision many years ago. Then the company acquired UGS and added PLM, CAD, and other digital technologies. There followed other similar acquisitions. I’m thinking mainly of the COMOS product, here.
If you are looking for an articulation of the strategy, I suggest looking no further than Industrie 4.0 and cyber-physical systems.
Sticking with Europe and the competition over there, let’s consider Schneider Electric. This company has been building the “electrification” side of the business which also brought industrial control products and some automation–think Modicon. While it lost considerable market share in PLCs, it did remain in the market. Then it acquired Invensys adding a lot of software (something it never really was good at) but especially process control (Foxboro, etc.). This latter helps it in the power market segment and positions it well against ABB. Siemens of course is the main competitive target. Then is a strange move, Schneider used its software businesses (Wonderware, etc.) as an investment in AVEVA grabbing 51% of the company. Now it, too, has a digital factory strategy in place.
ABB, a strong competitor in the power side of the business and also in process control, acquired B+R Automation. That company was a strong second-tier machine automation supplier fleshing out ABB’s portfolio in the discrete, or machine, automation market. Then it acquired GE’s industrial business strengthening ABB in the “electrification” market. Sounding familiar.
Now look at Rockwell’s investment. That company has flirted with Dassault Systemes over many years for a PLM-to-Control strategy. But nothing ever came of it.
A couple of years ago it acquired thin-client manufacturer ACP and systems integrator Maverick Technologies and MagneMotion a supplier of motion control and conveyor technologies. Then came a large investment in PTC for a small percentage of the company. I speculated that this could be a Digital Factory play along with the respected analyst Joe Barkai, but my friend Keith Larson writing for Putman Publishing (and someone I trust to accurately report on what suppliers are saying) reported that the sought-after prize was a closer integration with ThingWorx. This would be a piece of the Rockwell strategy of “Connected Enterprise” and Larson reported that the target RA product is its MES offering.
In other words, Rockwell Automation seems focused not on the current buzz of Industry 4.0/Industrial Internet of Things/Cyberphysical systems/Digital Factory, but on “making our customers more productive.” Its roots are plant floor and it remains a plant floor supplier.
I am NOT predicting any acquisition of Rockwell Automation, but I do believe that the market needs some continued consolidation. The next five years will be interesting in this market.
I’m on a bit of a break. World Cup. Brazil v Mexico was a passionate game (unlike Denmark v Croatia). But Belgium v Japan was one of the greatest games I’ve ever seen. What a lead! What a comeback!
Notice at the final whistle there was little celebration? All the players had given everything in the match. They were worn out.
Just like when we are (or should be) passionate about something. Give it your all–then recuperate.
I’m pondering during times between matches:
What is Rockwell Automation really going to get for its $1B investment in PTC?
What does the ABB acquisition of GE Industrial mean for the electrical balance of power in Europe, America, the world?
Will ThingWorx be the ultimate connectivity tool? How much is that really worth financially?
Will the IT companies I’m following (Dell Technologies, Hewlett Packard Enterprise) be big players in edge and IoT?
Will there be another process automation acquisition/merger? (The tea leaves seem ripe.)
Feel free to join the conversation. For the Americans–Happy Independence Day.
Fourth in the series of posts as I digest all of the information I gathered at Hewlett Packard Enterprise (HPE) Discover 2018 in Las Vegas. This post focuses on use cases. Yes, people, there are people some in manufacturing and some not who are using HPE IoT and Edge computing for fun and profit.
First off, a panel assembled by Tom Bradicich, VP and GM IoT and Edge and Ph.D. entitled Intelligence at the Edge.
Nathalie Elad of Comcast- We are an aggregator of data from homes sending this data from local server to cloud. He is working with HPE on virtualization. No, it doesn’t collect individual family usage to sell to others (yes, it came up). But the company does need data to know how to channel bandwidth. The challenge-“we double bits every 18 months and need to flex up and down during the day.” Interesting stat—there used to be 3.3 devices per house, now may be 20 or even 30.
Tim Thai, Tesla- OT—IT is still a challenge. “The Edge is dynamic, wherever business sets up shop.” Regarding IoT, there are “Things” in manufacturing-control and sensors. They incorporate sensors in testing of technology in cars. Not to mention “there are a ton of sensors in a car.”
Philip Rostle, Alfa Romeo Sauber F1 racing, discussed F1 race car as the edge. There are lots of channels coming off the car during a race. They measure performance versus predicted. You think you have connection problems, he described connection in race as “variable”. Every car has a GPS. They track all cars in the race trying to predict status of the other cars. They run scenarios, analytics, quickly at the edge during a race to help determine strategy. Took “moonshot” server power to the edge so that they get maximum performance within the rules of F1.
In a special breakfast session, we talked with the CTO of the Ryder Cup and European PGA Tour. Think you know golf? Ever wonder about some of the stats that the TV announcers can quote during an event? Well, the tour requires a lot of data. And to get that data, they need connectivity. Golf is also an entertainment event. There are 50,000 spectators at the Ryder Cup. They all expect WiFi to access real-time information about the tournament.
First the data. Every shot has a dozen parameters to capture for every golfer. These are logged on the course. To connect, they use Aruba wireless networking devices. There are 30 switches and 700 access points. They collect 20K data points for scoring; 140K data points for other shot information. “Data drives insights that leads to performance for golfers.” They can track each golfer and also track spectator traffic patterns. An untold story, they lay 18km of fiber cable each tournament; ready to go for Wednesday morning and tear down beginning Sunday evening.
Mike Orr, director of digital transformation at Murphy Oil, uses Edgeline on oil platforms. He noted that his biggest hurdle was working with IT mostly due to its legacy software systems. He made this technology economics point—when oil went from $140 to $20, company laid off many workers. The only way he could get his work done was with technology.
I’ve already discussed the Texmark Chemicals “Refinery of the Future” use case, but I learned a few additional points at this conference.
Intel supplied streaming video analytics—used for physical security/monitoring, open gate for railway access allowed humans and critters into the site, monitored for exception to alert operators.
Deloitte is developing an IoT practice. It assembled an ecosystem including NI, Allied, ThingWorx, OSIsoft, SparkCognition AI for pumps. It also developed the operator dashboards for the project.
All together there were 12 partners in the ecosystem that completed the project that included predictive maintenance for two critical pumps and the video surveillance system.
HPE coordinated the entire project.
The insurance company was impetus to do something to upgrade the technology. Texmark kicked off the project by renting a party bus and taking 15 employees to the HPE IoT lab in Houston. They saw a demo of a pump with FlowServe monitoring and analytics. Employees discussed and picked the initial project targets—two critical pumps in the process plus the “video as a sensor” for the railway access. Getting early employee involvement was the key factor for successful implementation.
Claroty has been busy. Following the news of investments and partnership with Rockwell Automation, Claroty and Siemens announced a global partnership. Siemens will leverage Claroty’s advanced behavioral analysis technology in Siemens’ recently announced Industrial Anomaly Detection solution.
Siemens, through its global venture firm Next47, also invested in Claroty, joining a global syndicate of industrial giants that invested $60 million in the company’s Series B round, bringing the company’s total investment to date to $93 million.
Siemens initiated the Charter of Trust in February 2018, gaining the support of other giant companies in the global fight against the rising cybersecurity threat to industrial systems. Siemens also continues to expand its cybersecurity portfolio, debuting at the 2018 Hannover Messe industrial automation conference a new Industrial Anomaly Detection solution, which will deliver significant value for both operations and cybersecurity teams. Operations teams receive a detailed inventory of industrial assets and changes to the network. Cybersecurity teams can continuously monitor these critical networks for vulnerabilities, malicious activity, and high-risk changes, across distributed industrial sites.
Claroty was selected by Siemens following an intensive technical evaluation. “In selecting our security partner for Industrial Anomaly Detection, we reviewed the market, conducted a detailed evaluation, and rigorously tested possible technology in our industrial lab environment,” said Dr. Thomas Moser, CEO of the Siemens Customer Services business unit. “Claroty’s advanced behavioral analysis provides a significant advantage to our customers in reducing risk to their OT environment.”
“Our mission is to help our customers secure industrial networks so they can avoid costly operations downtime, and maintain the safety of people and expensive assets,” said Amir Zilberstein, Claroty Co-founder and CEO. “Siemens’ selection of Claroty as a strategic partner and their investment in our company is further validation of our technology, our team, and our ability to deliver world-class, enterprise-level protection.”
Siemens uses Claroty in a pre-packaged offering enabling customers to quickly and safely deploy anomaly detection in their operations. Siemens brings the offering to the market based on pre-installed packages on Siemens IPC. In the future, it is planned to also offer this based on Siemens switches with an Application Processing engine provided by the Ruggedcom RX1500 series.
Siemens, as owner and operator of nearly 300 factories, heavily leverages digitalizing for efficiency gains. Responsible digitalization must go hand in hand with cybersecurity. Therefore, Siemens is implementing a defense-in-depth security concept in its factories. Industrial Anomaly Detection is an important element of this concept.
The Claroty Platform is comprised of multiple integrated products, built on Claroty’s advanced CoreX technology. The products provide the full range of cybersecurity protection, control, detection, and response. Claroty has received multiple industry awards in recent months. It was recently named an Energy Innovation Pioneer at CERAWeek 2018, and the company’s flagship Continuous Threat Detection product won the ICS Detection Challenge during the S4x18 conference in Miami.